Türkiye and Armenia’s decision to allow direct trade marks one of the clearest signs yet of a gradual shift in relations between the long-time rivals, although analysts say the immediate economic impact is likely to remain modest.

The agreement, announced on Wednesday, follows years of fragile diplomacy between Ankara and Yerevan. The border between the two countries has been closed since 1993, when Türkiye cut ties in solidarity with Azerbaijan during the first Garabagh war. Since then, official trade has technically been blocked, despite Turkish products continuing to reach Armenian shops through neighbouring Georgia.

For many Armenians, Turkish-made clothes, food and household goods have long formed part of everyday life, even as political relations remained frozen. However, indirect trade routes increased costs and reinforced the sense that the two neighbours were locked in permanent hostility.

Murad Muradov, Deputy Director at the Topchubashov Centre, told AnewZ that the latest move was more politically symbolic than economically transformative, but stressed that symbolism itself carries weight in the South Caucasus.

“The major significance is symbolic,” Muradov said. “Turkish goods have existed in Armenia for years, but formally they were re-exported through Georgia. This decision sends a signal that the process is ongoing and that it still has momentum.”

He noted that Turkish products had periodically become targets of boycott campaigns in Armenia after the 2020 Garabagh war, reflecting how deeply politics and consumer life remain intertwined.

Regional trade slowly reshaping attitudes

The latest development comes amid broader regional shifts following Azerbaijan’s restoration of control over Garabagh in 2023. Armenia has increasingly sought to diversify its foreign relations and reduce its heavy dependence on Russia, while cautiously improving ties with both Ankara and Baku.

Limited economic links between Armenia and Azerbaijan have also started to emerge. Azerbaijani fuel shipments to Armenia have helped reduce local prices, while transport discussions and infrastructure projects are slowly resuming after decades of closed borders.

Muradov said these economic contacts are gradually softening public scepticism.

“We’ve seen how social hostility is slowly being diluted,” he said. “People begin to see practical benefits.”

He argued that Türkiye has often appeared more proactive than Azerbaijan in pursuing normalisation with Armenia, partly because Ankara sees wider geopolitical and economic opportunities in a more connected South Caucasus.

“For Türkiye, this is also a chance for political and economic expansion,” Muradov said. “Ankara sees that Armenia is increasingly ready to reduce Russian influence and become more open.”

Peace with Azerbaijan remains central

Despite the growing momentum, Türkiye has repeatedly made clear that full normalisation with Armenia depends on a comprehensive peace agreement between Yerevan and Baku.

Muradov said Azerbaijan still views a political settlement as the priority, even while supporting limited economic engagement.

“The terms of the peace agreement have already been negotiated to a great extent and for us this is non-negotiable,” he said.

At the same time, he described a more open Armenian economy and diminishing Russian influence as positive developments for the wider region.

“Armenia becoming more open to investors and seeing a diminishing Russian presence is of course a very good thing,” he added.

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Elections approaching in Armenia

The gradual thaw also carries domestic political implications inside Armenia ahead of parliamentary elections expected next year.

Prime Minister Nikol Pashinyan has increasingly presented reconciliation with neighbouring countries as part of a broader effort to modernise Armenia’s economy and break away from Moscow’s orbit.

Muradov said recent diplomatic successes have strengthened the Armenian government politically.

He pointed to major international events hosted in Yerevan and growing Western engagement with Armenia as signs that the government is gaining confidence and legitimacy.

“The government was able to organise major international events and move things forward,” he said. “At the moment, the momentum appears to be on the government’s side.”

Still, resistance to normalisation remains strong among opposition groups and parts of Armenian society shaped by historical trauma and fears of Turkish influence.

Muradov said some Armenians continue to worry that Türkiye’s growing presence could weaken Armenia’s sovereignty. Yet he argued that practical cooperation projects could gradually challenge those fears.

“This kind of step shows there can be larger and more public reconciliation,” he said.

Even so, few expect a rapid transformation. Decades of conflict and mistrust continue to shape public opinion on both sides of the border. But for businesses, travellers and families long separated by political barriers, even limited direct trade represents a change that once seemed impossible.

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Armenia Türkiye economic momentum Diplomacy Trade Regional Security